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Volume :47 Issue : 180 2021      Add To Cart                                                                    Download

Shareholders General Meeting Invalidity in a Public Joint Stock Company due to Material Error in Convocation.

Auther : Dr. Abdulwahab A. Sadeq - Dr. Mohamad I. AlWasmi

Objectives: This study aims to make a proposition saving the company management and shareholders' precious time, effort and money. It is in relation to the common knowledge that unlawful convocation of the shareholders general meeting would lead to the invalidity of each of the meeting resolutions.
Method: This study adopted the descriptive analytical approach as it examines laws and the Court of Cassation's rulings in order to find the optimal solution for the matter in question.
Results: A material error in the convocation need not always be a cause for the invalidity of the shareholders general meeting. When the shareholders have voted to rectify the material error, the annulment for the general meeting and all its resolutions is considered irrelevant. This in light of the fact that shareholders have had the opportunity to point out and rectify the error, as long as such error did not cause any harm to others.
Conclusion: This study recommends that viable solutions should be provided to this problem lest similar issues arise which be subject to judicial discretion.

Keywords: Shareholders General Meeting, Joint Stock Company, Material Error, Convocation, Companies, Action for Annulment.

 

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Dec 26, 2021

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